Did the Librarian forget the iPod Touch and the iPad?

Posted By: Ronald Rasmussen

The Librarian of Congress on July 26, 2010, announced six classes of works that are now exempt from the prohibitions against circumvention of technological measures controlling access to copyrighted works. This meant that persons making noninfringing uses of works in those six classes are not subject to the portions of the Digital Millennium Copyright Act (DMCA) found at 17 U.S.C. §1201(a)(1) prohibiting circumventing technological access controls to works subject to copyright. This exemption lasts until the conclusion of the next rulemaking.
The second class of works announced was defined as follows:
Computer programs that enable wireless telephone handsets to execute software applications, where circumvention is accomplished for the sole purpose of enabling interoperability of such applications, when they have been lawfully obtained, with computer programs on the telephone handset.
This ruling came about in part because of the dispute between Apple Computer Inc, and iPhone users over “jailbreaking,” the practice of circumventing the access controls in order to load and operate other, non-Apple-provided, software on the device. Apple has maintained that jailbreaking is a violation of copyright law, and of course that it voids the warranty. The Electronic Frontier Foundation, or EFF, has argued that it is a “fair use,” and therefore legal. EFF based this claim on three specific arguments. First, EFF claimed that in some situations, jailbreaking could be done within the scope of the Apple software license agreement. Second, EFF argued that an iPhone owner also owns the copy of the phone’s firmware, and therefore under 17 U.S.C. §117(a), the owner can adapt the copy to add new capabilities, as long as the changes made by the owner do not “harm the interests of the copyright proprietor.” This was the “adaptation as essential step to usage” argument. Third, the EFF contended that jailbreaking was a purely noncommercial, private use of the computer software that operates the phone, so the user was altering the firmware for their own use only, without any change in market.
The Apple iPod Touch and the Apple iPad uses the same or similar firmware as the Apple iPhone, and has been subject to the same jailbreaking practices. The Touch and iPad use many of the same apps as the iPhone. Apple has traditionally locked the Touch and iPad down in the same way as the iPhone, with applications only available through Apple. However, the Touch and iPad do not appear to be covered as phones, as they have no capability to make or receive calls, and the exemption covers only “wireless telephone handsets.” This omission appears to leave the iPad and Touch untouched by this “jailbreaking is legal” ruling. Continue reading


The Worldwide Leader in Sports in Murky Anti Trust Waters

Posted By: Cason Schmit

My Brother and his wife are Northwestern Alums and love their football. Three weeks ago, the Northwestern Wildcats were in the middle of their upset win over the then 13th ranked Iowa Hawkeyes. Unfortunately, the game was not broadcast in their area, so their only hope to see it live was on the Internet. Naturally they went to ESPN.com, “the Worldwide Leader in Sports,” to view the game. Although, ESPN streams games of all kinds from its website for free, not everyone can view them. As it turns out, ESPN does not permit viewers to watch games if they are not using an approved internet service provider (ISP). ESPN’s notice states: “In order to access ESPN3.com, you must receive your Internet Service from one of the providers in the list below or connect through a network on a U.S. college campus or military base.  Your current network falls outside of these categories.” http://espn.go.com/espn3/index. To my brother and his wife’s frustration, their ISP is not one of the preferred ISPs, so they were unable to view the game.
Why might ESPN have this strange requirement? It could be that the preferred ISPs have a special agreement with ESPN such that ESPN benefits from the use of these particular ISPs. And this appears to be the case. ESPN provides a special notice to users with Time Warner as an ISP: “Attention Time Warner Cable Customers: In order to watch ESPN3.com, you must receive ESPN as part of your television service.” http://espn.go.com/espn3/index. This requirement shows that ESPN is trying to leverage its market power in online broadcasting to further boost its revenue in cable broadcasting where its market power is much weaker.
This practice could very well have antitrust implications. The Sherman Anti Trust Act forbids certain types of tying arrangements. A tying arrangement occurs when the seller with dominant market power conditions the sale of a product on the purchase of another product that the buyer might not necessarily buy otherwise, thereby impeding competition in the tied product market. Allen-Myland, Inc., V. IBM, 33 F.3d 194 (1994).
Based on ESPN’s terms of service, it could be seen that ESPN is tying the availability of a streaming sporting event (tying product) to the use of particular ISPs (tied product). This kind of “tying arrangement” can be in violation of the Sherman Anti Trust Act but is not necessarily so. The court in Allen-Myland v. IBM held that in order for a tying arrangement to rise to the level of an antitrust violation two things must be shown: 1) the seller has sufficient market power over the tying product, and 2) the arrangement affects a “substantial amount of interstate commerce.” 33 F.3d at 200-201.
Before addressing the first question, it is important to define the market for the tying product. ESPN would likely wish the market to be defined as sport broadcasting, in which case, its market power would be low due to the presence of the television broadcasters and other internet broadcasters. However, a Real Madrid fan doesn’t care about the NFL and a Northwestern Football fan doesn’t care about a Duke Basketball game. In essence, different sporting events are not interchangeable within the market. Furthermore because of team loyalties, a Northwestern Football game might not be interchangeable with a Florida State Football game and vice versa. In other words, fan loyalty prevents one game from being a suitable substitute for another. Because of interchangeability problems between different sporting events and that viewers have specific preferences that define their demand, the relevant market should seemingly be defined as the broadcast of a specific sporting event. Because my brother and his wife are outside the local broadcast area for Northwestern games, the relevant market from them is defined as Internet broadcasts of Northwestern Football games. In this market, ESPN’s power is absolute due to exclusive broadcasting agreements.
The second inquiry in determining the legality of tying arrangements is whether the tying arrangement is affecting a substantial portion of interstate commerce. A few things are clear, 1) ESPN is attempting to leverage its online broadcasting monopoly to favor specific ISPs over others and to encourage purchase of cable television services from firms that purchase its sercvers; 2) by denying access to the broadcast, ESPN is restricting the supply of its broadcast to the demand of individuals using disfavored ISPs; 3) internet users unwilling to change to a preferred ISP are completely barred from access to this market; 4) ESPN’s restrictions limit the reach of advertisers who purchased time during the given broadcast; and 5) there is variability in the cost of using different ISPs for consumers. However, the question remains as to whether these factors, in fact, affect a substantial amount of interstate commerce, which would no doubt require a significant market inquiry.
The weight of that question most certainly will be left to the courts to decide. However, it is apparent that ESPN’s tying practice raises interesting questions under the Sherman Anti Trust Act.


Posted By: Joseph Duerst

In an episode of the television show Seinfeld, when George is caught with large prints of semi-nude photos of himself taken for a photo shop woman he was trying to impress, Jerry Seinfeld calls it, “the timeless art of seduction.” The episode made light of the lengths that people will go in the pursuit of romantic relationships, but when it aired in the mid-1990s, nobody knew the technological advances that would occur in the following years. In the year 2010, rather than making prints of those photos, George would have likely just sent an email or a photo message to the woman’s cell phone, and that such activity could create legal liability for George should the photos end up in the wrong hands. While in television this activity could create comedic scenarios, in real life, those scenarios could devastate the people involved.
Technological advances have supplied us all with the means to share information, photos, music and other content instantaneously through various channels including the internet and wireless telephone lines. The possibilities are nearly limitless as to the kind and quality of the information and content we can share with each other, beamed directly to our laptops and our cell phones. However, the kind of content we send can create substantial legal problems, if that content turns out to be illegal. Unsurprisingly, people have chosen to use these new methods of communication to share sexually explicit messages and nude photos of themselves to romantic partners. Sexting, as it is called, because it usually involves the sending of text messages to cellular telephones, can be perfectly harmless if both parties consent to the activity and do not abuse the trust of the other, but this is not always the case. Likewise, in cases involving the nude photos taken by minors, the legal implications become staggering.
The Berkman Center For Internet & Society at Harvard University recently released a report on sexting, which maps out sexting among youths and the legal problems that surround such activity. The report provides statistical information regarding different situations in which sexting occurs, and some background on the repercussions of those situations. According to the report, states have growing concern with youths the sext, and have responded in a myriad of ways, including prosecuting minors for posting their own nude photographs on MySpace or sending them to other youths. Most charge the youths with violations of child pornography laws, which is troubling, because the youths face the same penalties for photographing themselves and sharing the photos, as would an adult who photographs a youth nude, such as prison sentences and sex offender registration. One must ask the question, is self-exploitation by children really what child pornography laws are meant to protect against? Child pornography cases of the past imply that this kind of voluntary action by a child may be protected speech under the First Amendment. Even more troubling is prosecution in the context of a romantic relationship among two youths who swap naked photos. But even when both parties consent to swap photographs, if one party abuses that trust and shares the photos with friends, as youths would be likely to do, both the sharer and the friends may be subject to liability.
The Berkman Center’s report discusses the basis for charging these youths and the defenses to the charges, but the fundamental problem seems to be a matter of public policy. Charging a youth under child pornography laws for photographing himself or for sharing a girlfriend’s photographs with his friends seems unduly harsh. Children lack the ability to understand the repercussions of their actions and often have knowledge that their conduct may be illegal. They are given the ability to share photographs via their cell phones and computers, and they are rarely told what is conduct is allowable and what is not. The report suggests modifying child pornography statutes to include an affirmative defense that exempts children who photograph themselves and share with other minors they choose, and including lesser penalties for children than adults would face, in such cases where activity is more harmful than mere sharing of personal nude photographs and thus would not be exempted. Some states have done exactly that.
However, the Berkman Center’s report does not address issues of adult sexting that does not involve child pornography. Largely, adults sharing sexual images and messages with each other is perfectly legal, but this activity can still expose adults to exploitation and liability. Imagine a situation in which a man sends a nude photograph to his girlfriend’s phone, but a child that she babysits sees the photograph. Or imagine a scenario where the man accidentally sends to photo to the wrong email address. Emails and texts are instantaneous and nearly impossible to retract. Both scenarios could cause the man considerable trouble, including embarrassment, legal liability for obscenity, or public ridicule. At the rapid pace we send our texts and emails, we often think little of these possible consequences, but perhaps we should. Fifteen years ago, to send a photo to someone would require physically taking it to that person, providing more time for reflection and reconsideration of sending the photo, but with an email, this time for reflection is non-existent and the possibility that photo reaches an unintended party is great. Today, “the timeless art of seduction” could send George to jail.
A PDF copy of the Berkman Center’s report can be accessed here.

A New Model For Streaming Video On the Internet (Or Is It?)

Posted by: David Brookshire

Recently demand for internet streaming of movies exploded with Netflix Instant Streaming accounting for up to 20% of total United States bandwidth use at peak hours. Dozens of competitors are vying to digitize and stream as much content as they can to attract customers. As a result, the content industry has acquired some major leverage with their licensing. While copies of newly released DVDs of movies may be immediately available for purchase or rental, studios attempt to delay online licensing in order to boost purchases of physical copies. Frequently when the online streaming licenses are finally granted they are usually first signed with a firm granted an exclusive license for a limited period, blocking out other competitors for a period of time.
With the difficulty and expense of buying a license for streaming content it was only a matter of time before someone attempted a short cut. Enter Zediva, a new startup specializing in streaming video over the web. Zediva claims to have new movies online the day they come out in stores, in other words, before Netflix and any other company have been able to acquire the licenses to stream. This is because Zediva says that they are not “streaming” the content, just “renting” it over the internet. So Zediva purchases new DVDs and allows users to “rent” them instead of “streaming” them. Sounds like the perfect model, right? Zediva gets to save on licensing fees and gets the movies quicker then any of their competitors. What could go wrong?
Well, Zedia’s business model may open it up to suits for copyright infringement because without a license they are probably infringing the copyright owner’s exclusive right of public performance.

Zediva claims they purchase several copies of new DVDs which they put in specialized DVD players that then stream the content over the internet. Zediva argues that they are merely renting the DVD and the player just like a physical store would, except instead of renting the physical DVDs they are digitally renting them. The founder describes the system as “a really long cable and a really long remote control.”
The problem with this argument is that movie rental stores do not infringe copyright because they do not violate the copyright owner’s exclusive right of public performance. Under the Copyright Act a motion picture is performed publicly when it is performed or displayed in a place open to the public OR if the performance is transmitted to the public by means of a device.
It may be helpful to think about a television broadcast which you are watching in your home. There are actually two performances in this case, the transmission by the television station, and the display on your TV at home, but only the broadcast station is engaging in a “public” performance. Thus if they had no license to publicly perform the work they would be infringing the copyright owner’s right. DVD rental stores do not violate this right because the movies are taken home by the customer and played privately in their home. There is only one performance and it is made by the customer.
Zediva would like to claim they are exactly like the physical video rental store, the customer may perform the work but Zediva does not; they claim Zedivaonly provide all of the equipment for their customers and therefore do not violate the copyright owner’s right. But this is not exactly true. Zediva is much more like a potentially infringing broadcast station then a DVD rental store. Even though the customer may press play on their computer, Zediva still has to transmit the movie to them. Thus, like the broadcast, there are actually two performances: the performance by Zediva in transmitting the work to the public, and the performance on the customer’s computer. Without acquiring a license to publicly perform the content, Zediva may be infringing on the copyright owner’s exclusive right and theereby opening up themselves to lawsuits.
Zediva might claim that they are not transmitting the work to the “public”, because only one customer at a time can view the movie. Unfortunately for them, the definition of public performance in the copyright act apparently excludes this possible interpretation because the statute specifically includes transmissions that are watched at the same time or at different times. And as the 3rd Circuit explained in Columbia Pictures Industries Inc. v. Aveco, Inc. a performance does not have to be displayed in a crowded room to be in public. After all, a public restroom stall is definitely considered public even though it can only be occupied by one person at a time.
It won’t be long before movie studios take note of Zediva’s system because, if allowed to continue, this model will destroy their carefully crafted and incredibly lucrative licensing system.
The long and the short of it is, you cannot stream copyrighted content over the internet without a license and without without rising some serious potential infringement issues. So Zediva might consider not organizing its entire business plan around this concept.